What is commercial money?
The term commercial bank money describes the portion of a currency which is made of book money – debt generated by commercial banks. It is the opposite of the terms central bank money, base money and sovereign money, which denote legal tender issued by a central bank or monetary authority.
What is fiduciary money?
Fiduciary cash, currency or money, refers to banknotes and coins available for use in the economy. This is the liquidity accessible to financial actors to do exchanges. It is a method for payment. Cash is a substantial or tangible asset, not at all like scriptural cash which is insignificant.
Dollar bills are examples of fiat money because there are no physical commodities backing them. Also, the value of a dollar bill is determined by the government. Therefore, the correct answer is option D since it is the best example of fiat currency.
Examples of commodity money are gold and silver coins. Gold coins were valuable because they could be used in exchange for other goods or services, but also because the gold itself was valued and had other uses. Commodity money gave way to the next stage-representative money.